Political Capital » Defensehttp://go.bloomberg.com/political-capital
Politics blog featuring the latest news and analysis from Washington and the US. Political editors provide insights & data about today’s politics.Thu, 07 Aug 2014 19:48:32 +0000en-UShourly1http://wordpress.org/?v=3.8.2Obama’s Afghan Withdrawal: 2016http://go.bloomberg.com/political-capital/2014-05-27/obamas-afghan-withdrawal-2016/
http://go.bloomberg.com/political-capital/2014-05-27/obamas-afghan-withdrawal-2016/#commentsTue, 27 May 2014 15:50:30 +0000http://blogs.edit.bloomberg.com/political-capital/?p=131688Updated at 2:53 and 2:57 pm EDT The war is over in Afghanistan. Or is it? President Barack Obama effectively said so over the weekend, as he made a surprise visit to Bagram Air Base and said — to the cheers of troops gathered for his visit — that this will be the final deployment […]

President Barack Obama greets U.S. troops during a surprise visit to Bagram Air Field, north of Kabul, in Afghanistan, on May 25, 2014, prior to the Memorial Day holiday.

Updated at 2:53 and 2:57 pm EDT

The war is over in Afghanistan.

Or is it?

President Barack Obama effectively said so over the weekend, as he made a surprise visit to Bagram Air Base and said — to the cheers of troops gathered for his visit — that this will be the final deployment “for most of you.”

As the U.S. winds down a war that has run more than a decade, American forces still number about 30,000 there. The U.S. is in the midst of a military transition, with Afghan security forces taking charge of combat with the Taliban. But, while the U.S. combat mission at year’s end, with American forces serving in an advisory role — no more patrolling of cities or countryside — that transition does not mean a complete withdrawal.
The president announced in the Rose Garden today that the U.S. will leave 9,800 troops in Afghanistan next year in support of the nation’s military. Margaret Talev reported that the number is to be cut in half by the end of 2015, and the actual pullout is targeted for the end of 2016.

”Americans have learned that it is harder to end wars than it is to begin them — but this is how wars end in the 21st Century,” Obama said today. Tomorrow, he said, he will address the nation’s newest class of military officers in commencement ceremonies at West Point with word of a broader vision. “We will begin a new period of American leadership around the world.”

Which coincides with the American political calendar.

Obama inherited the war declared following the terrorist attacks on New York and the Pentagon on Sept. 11, 2001 — one of two left to his military, following the U.S.-led invasion of Iraq. He can expect to leave office, under the plans to be announced today, with the books on both closed.

]]>http://go.bloomberg.com/political-capital/2014-05-27/obamas-afghan-withdrawal-2016/feed/0Elon Musk Shaking Up D.C. — Like Auto and Space Raceshttp://go.bloomberg.com/political-capital/2014-05-22/elon-musk-shaking-washington-like-space-auto-industries/
http://go.bloomberg.com/political-capital/2014-05-22/elon-musk-shaking-washington-like-space-auto-industries/#commentsThu, 22 May 2014 14:17:42 +0000http://blogs.edit.bloomberg.com/political-capital/?p=131416Billionaire Elon Musk doesn’t do anything quietly. His Space Exploration Technologies Corp. won a battle with Amazon.com’s Jeff Bezos to lease a historic Kennedy Space Center launch pad, was the first private U.S. company to dock a spacecraft at the International Space Station and is competing to become the first private company to send astronauts […]

His Space Exploration Technologies Corp. won a battle with Amazon.com’s Jeff Bezos to lease a historic Kennedy Space Center launch pad, was the first private U.S. company to dock a spacecraft at the International Space Station and is competing to become the first private company to send astronauts into space.

His Tesla Motors Corp. is trying to upend the traditional way of selling cars and is pushing states to allow him to go directly to consumers instead of working through auto dealers.

It’s the same in Washington. While Musk has hired his own team of high-powered lobbyists, including former Sen. John Breaux, a Louisiana Democrat, and the firm of former Assistant Senate Republican Leader Don Nickles of Oklahoma, he’s also gone after his competitors, something rarely seen in the federal contracting world. His major push is to break into the military’s satellite launch market, worth roughly $70 billion and now monopolized by a joint venture of Lockheed Martin Corp. and Boeing Co., the two biggest U.S. contractors.

“Elon Musk is a genuine outsider,” said Loren Thompson, a defense analyst with the Lexington Institute, an Arlington, Virginia-based research organization, and a consultant to companies including SpaceX competitor Lockheed. “He is a disruptive influence who will probably change the way business is done in the space sector.”

Musk attracts a crowd on Capitol Hill and has support among lawmakers who agree that increasing competition in the launch business could save taxpayers money.

“He’s an unusual CEO,” said veteran lobbyist Tony Podesta, who formerly represented SpaceX. “He’s also very aggressive about his advocacy and bulding relationships with decision makers and policy makers. People on the Hill find him fascinating.”

Musk also runs the risk of making enemies. For example, he has sued the Air Force, the agency responsible for awarding the contracts to launch the military satellites.

“Maybe he should have taken a basic political science course to figure out there are other ways to try to influence the Air Force other than suing them,” said James Thurber, director of the Center for Congressional and Presidential Studies at American University in Washington. “It’s not very good advocacy policy to sue.”

If Musk provides a good product for a low price, the Air Force will have little choice but to deal with him, said Jeff Foust, a senior analyst at Futron Corp., a Bethesda, Maryland-based consulting firm specializing in
aerospace and technology.

“He’s not out trying to make an enemy of the Air Force,” Foust said. “In the end, depending on what the court rules or what sort of settlement he reaches, the Air Force may decide, `Yes, we have to do business with him.’ They may not like him personally, but if he delivers, they’ll have to accept that.”

]]>http://go.bloomberg.com/political-capital/2014-05-22/elon-musk-shaking-washington-like-space-auto-industries/feed/0Defense Companies Play Offense in 2014 Electionshttp://go.bloomberg.com/political-capital/2014-05-13/defense-companies-playing-offense-2014-elections/
http://go.bloomberg.com/political-capital/2014-05-13/defense-companies-playing-offense-2014-elections/#commentsTue, 13 May 2014 14:06:29 +0000http://blogs.edit.bloomberg.com/political-capital/?p=130526Government contractors are putting their money where their mouths are. The top 10 contractors, as compiled by Bloomberg Government, have increased their political action committee spending by 29 percent for the 2014 congressional elections, compared with their donations for the 2012 races. The lawmakers elected Nov. 4 will decide the future of the across-the-board cuts known as […]

An AIM-120 Advanced Medium Range Air-to-Air Missile manufactured by Raytheon Co., is seen on a Lockheed Martin Corp. F-16D Fighting Falcon aircraft, during the Singapore Airshow in Singapore on Feb. 12, 2014.

Government contractors are putting their money where their mouths are.

The top 10 contractors, as compiled by Bloomberg Government, have increased their political action committee spending by 29 percent for the 2014 congressional elections, compared with their donations for the 2012 races.

The lawmakers elected Nov. 4 will decide the future of the across-the-board cuts known as sequestration, which has sapped contractors’ sales to the federal government. A two-year budget agreement partially mitigating the reductions expires next year.

“There is a real possibility that the 2014 elections will change the attitude in Congress toward the sequester, and I expect government contractors are investing their money behind candidates who would support their interests,” said Craig Holman, a lobbyist for Public Citizen, a Washington-based advocacy group that supports stronger campaign finance laws.

The government’s Top-10 suppliers, most of them primarily defense companies, made $13.7 million in PAC contributions during the first 15 months of the current two-year election cycle, which began Jan. 1, 2013. That compares with $10.7 million from Jan. 1, 2011, though March 31, 2012.

“It’s an opportunity to get in front of people and say, `We’ve got to stop the sequestration because it’s killing our defense and it’s killing our companies,”’ said a former House Appropriations subcommittee chairman, James Walsh, a New York Republican now at the law firm K&L Gates LLP.

Company representatives regularly visit Capitol Hill to argue that sequestration hurts national security. Four of the seven largest contractors in the BGOV 200 — Lockheed Martin Corp., Boeing Co., Northrop Grumman Corp. and United Technologies Corp. — were among the 10 biggest corporate spenders on lobbying during the first three months of 2014, according to the Center for Responsive Politics, a Washington-based research group.

“I don’t think the companies expect to get a major change in the level of defense spending this year,” said Loren Thompson, a defense industry consultant and an analyst with the Lexington Institute, an Arlington, Virginia-based research organization. “They’re positioning for after the election.”

]]>http://go.bloomberg.com/political-capital/2014-05-13/defense-companies-playing-offense-2014-elections/feed/0Azores Base Cause for Congressman With Family Rootshttp://go.bloomberg.com/political-capital/2014-04-24/azores-base-cause-congressman-family-roots/
http://go.bloomberg.com/political-capital/2014-04-24/azores-base-cause-congressman-family-roots/#commentsThu, 24 Apr 2014 10:30:12 +0000http://blogs.edit.bloomberg.com/political-capital/?p=128723From Bloomberg Government’s Congress Tracker: Rep. Devin Nunes is fighting to protect an airfield in the Azores, his family’s ancestral island home. Nunes is seeking to prevent the withdrawal of U.S. forces from the Lajes air field in the Azores, an autonomous region of Portugal in the north Atlantic Ocean. Instead, Nunes wants the base to become a staging ground […]

Rep. Devin Nunes is fighting to protect an airfield in the Azores, his family’s ancestral island home.

Nunes is seeking to prevent the withdrawal of U.S. forces from the Lajes air field in the Azores, an autonomous region of Portugal in the north Atlantic Ocean. Instead, Nunes wants the base to become a staging ground for operations under the U.S. Africa Command.

Portuguese government officials say the withdrawal would cause an “unmitigated economic disaster,” Nunes said in an interview this week. The California lawmaker returned last weekend from a congressional delegation’s trip that included a stop in Portugal. The delegation was led by House Speaker John Boehner, who made Portugal a destination on a journey including Afghanistan and Turkey at the request of government officials there to discuss Lajes’s future, according to Nunes.

Without a new mission as a “forward-operating base,” Lajes on Terceira island is at risk of losing most of the U.S. military presence and, with it, the livelihood of its local community.

Tearing down operations could cost as much as $1 billion, vastly more than the $150 million already spent to modernize the base, said Nunes, who’s part of a large Portuguese and Azorean community in California’s San Joaquin Valley. “Essentially what we have there is a brand new base,” he said.

Citing budgetary constraints, the Pentagon in 2012 announced it was planning to reduce its military operations at Lajes and cut the 1,100 U.S. and Portuguese personnel by half.

The U.S. base is the island’s second-largest employer.

The U.S. has had a presence in Lajes since World War II. It played a crucial role in the tracking of Soviet submarines during the Cold War. For the wars in Iraq and Afghanistan, fighter, tanker and transport planes regularly stopped there.

Nunes, who gathered support in the House and Senate from lawmakers with constituents of Portuguese ancestry, primarily in Massachusetts, California and Rhode Island, was successful in including a provision in the fiscal 2014 defense authorization that keeps the U.S. military facility at full capacity “until further notice.”

]]>http://go.bloomberg.com/political-capital/2014-04-24/azores-base-cause-congressman-family-roots/feed/0Defense Cuts Face Political Bases: Warthog, Spy-Plane Defendershttp://go.bloomberg.com/political-capital/2014-02-25/defense-cuts-and-political-bases-warthogs-to-spy-planes-have-defenders/
http://go.bloomberg.com/political-capital/2014-02-25/defense-cuts-and-political-bases-warthogs-to-spy-planes-have-defenders/#commentsTue, 25 Feb 2014 21:11:47 +0000http://blogs.edit.bloomberg.com/political-capital/?p=122321From Bloomberg Government’s Congress Tracker: Defense Secretary Chuck Hagel has presented Congress with some unpalatable political decisions in the midst of an election year. His budget proposal for fiscal year 2015 would create some clear political losers. Among them: congressional districts in Arizona, Georgia, Wisconsin and Utah. Since the administration’s plan is just the starting […]

A U.S. Air Force A-10 “Warthog” from the 332nd Air Expeditionary Wing takes off for a mission into Iraq.

From Bloomberg Government’s Congress Tracker:

Defense Secretary Chuck Hagel has presented Congress with some unpalatable political decisions in the midst of an election year.

His budget proposal for fiscal year 2015 would create some clear political losers. Among them: congressional districts in Arizona, Georgia, Wisconsin and Utah.

Since the administration’s plan is just the starting point that Congress uses to write the annual defense bills, the final product could bear little resemblance to what Hagel has proposed.

Chief among the battles may be the retirement of the A-10 “Warthog” fleet.

The military’s desire to stop using the tank-killing, close-air support plane “is going to be a real problem,” House Armed Services Committee Chairman Buck McKeon said in an interview. “It’s got quite a constituency and they have a lot of strong reasons why it should be kept.”

Any time the military adds or subtracts a weapon, there’s a business impact to the communities where the parts are made and the final-assembly factory puts it together. “You have to deal with the reality,” the California Republican said. “People keep things in their districts.”

Here’s our look at the weapons that the Pentagon picked to be the biggest losers — and where to expect push-back from lawmakers in the months ahead:

A-10 Warthog

A-10 pilots train at Davis-Monthan Air Force Base in Tucson, Arizona, represented in the House by Democrat Ron Barber, a member of the Armed Services Committee. Its senators are Armed Services Committee member John McCain and Jeff Flake, both Republicans. Barber, whose district is politically competitive, made the case with the Pentagon last year not to retire the plane in 2014.

Moody Air Force Base in Valdosta, Georgia, is home to the 23rd Wing, which employs A-10s.

According to the website of Austin Scott, a Georgia Republican and member of the House Armed Services Committee, the largest Air Force A-10 fighter group is based at Moody.

Chicago-based Boeing Co. builds new wings for the plane at its Macon, Georgia, plant. The new wings are envisioned to allow the A-10 fleet to operate into 2035.

Davis Monthan Air Force Base near Tuscon, the main training base for the A-10, has an economic impact of about $1.6 billion on the local community, according to economic impact analyses issued by the base. That number includes economic activity by military retirees who stayed in the area.

The Air Force does upgrades and depot work for the plane at Hill Air Force Base in Ogden, Utah. Upgrade kits are made by Lockheed Martin in Oswego, New York. Rob Bishop, a Republican who represents Ogden in the House, has made the case against the retirement of the A-10 in a letter sent to the Secretary of the Air Force in September. The No. 3 Senate Democrat, Charles Schumer of New York, has been an outspoken supporter of Lockheed’s operations in his state.

The program has another noteworthy advocate, as well: Senator Kelly Ayotte, whose husband flew the A-10, backed a provision in the 2014 defense policy bill that prevented the retirement of the A-10 this fiscal year. The New Hampshire Republican, also a member of the Senate Armed Services Committee, said after Hagel’s announcement that she will fight the Pentagon’s proposal.

U-2 Spy Plane

Robins Air Force base, which is also in Scott’s Georgia district, would be hit if the U-2 spy plane is retired, as the Pentagon proposes.

Waltham, Massachusetts-based Raytheon Co. provides field service for ground stations, sensors and data links for the U-2 at the base’s logistics center.

The Air force wants to retire the U-2, which began flying spy missions over the Soviet Union in 1956, in favor of the Global Hawk surveillance drones made by Falls Church, Virginia-based Northrop Grumman Co. Northrop does final assembly for the drone in McKeon’s California district.

McKeon said that Congress won’t necessarily back the U-2 retirement decision.

Littoral Combat Ship

The Pentagon wants to build a fleet of 32 shore-hugging Littoral Combat Ships instead of 52 originally proposed.

Versions of the ship are made by Lockheed and Henderson, Australia-based Austal Ltd in Mobile, Alabama, and Marinette, Wisconsin.

Senator Jeff Sessions of Alabama, the ranking Republican on the Budget Committee and a senior member of the Armed Services Committee, has protected the program, which has created at least 4,000 jobs there, according to Austal. Sessions, who’s up for re-election this year, also has the backing of Alabama’s senior Republican, Richard Shelby, ranking Republican on the Senate Appropriations Committee.

In Wisconsin, Republican Reid Ribble represents the Marinette area in the House and has fought to protect the program. Ribble has said that the LCS contract changed the “demeanor” of the city which had suffered from high unemployment.

National Guard

Reductions in the National Guard forces, as proposed by Hagel probably will face opposition from governors across the country.

Guard units answer to state leaders and can be put on active duty by the president during wartime. Under Hagel’s proposal, the Army National Guard’s numbers would drop from about 355,000 today to 335,000 by 2017. If automatic budget cuts, known as sequestration stay in place in 2016, that number would drop to 315,000, Hagel said.

Army Bases

The active Army would take the brunt of the personnel cuts if Congress allows them to take place. Hagel’s plan would reduce the Army by 6 percent to about 490,000 personnel by 2015 from about 522,000 today, accelerating by two years the Army’s plan to reach that total by 2017. Hagel’s proposal also calls for reductions to about 450,000 by 2019 — 30,000 fewer than the active-duty force in September 2001 before the terrorist attacks on the U.S.

Senate Armed Services Committee Chairman Carl Levin of Michigan said Pentagon officials have “a tough case to make” that Army personnel cuts “are appropriate, that they will not affect morale, that they won’t affect recruitment” and will have a significant impact in terms of savings. The Pentagon will also have to show how the plan will “protect modernization and readiness,” he told reporters.

A model of a F-16 fighter jet, manufactured by Lockheed Martin Corp., during the 13th Dubai Airshow at Dubai World Central on Nov. 18, 2013.

The defense aerospace industry, which includes contracting giants Lockheed Martin and Northrop Grumman, has been a strong financial supporter of congressional Republicans, allotting 63 percent of their campaign donations this year to the party’s candidates and committees.

The Republicans’ insistence on cutting spending, however, isn’t sitting well with the industry.

“You can’t keep cutting and cutting and expect us to do more with less,” said Marion Blakey, president of the Aerospace Industries Association, at the trade group’s annual luncheon today. “At some point you can only obtain less from less: less defense readiness, reduced aviation system capacity and fewer missions to chart the cosmos.”

Blakey’s organization led a lobbying campaign against the across-the-board cuts known as sequestration, and won a partial victory when the new budget agreement offset some of the reductions.

The group will continue to urge Congress to find a permanent alternative to sequestration, she says, and to highlight the effort is singling out some allies. Manufacturers, universities and groups supporting social spending are all part of the coalition and joined the AIA at a press conference at the beginning of the month calling for an end to sequestration.

Despite the bipartisan budget agreement, many Republicans did not support the increased spending, including Senate Minority Leader Mitch McConnell. “Congress should continue to adhere to the fiscal restraints it set,” he said in opposing the legislation.

Budget cuts shouldn’t be the top priority to the exclusion of everything else, Blakey said.

“Regrettably, at some point the excessive pursuit of fiscal austerity over and above all other national objectives will come back to haunt us,” she said, calling on Congress to “develop a long-term plan that doesn’t sacrifice needed investment in our nation’s future on the altar of budget austerity.”

]]>http://go.bloomberg.com/political-capital/2013-12-18/aerospace-industry-president-decries-excessive-pursuit-of-fiscal-austerity/feed/0Norquist: ‘End of the Grand Bargain’http://go.bloomberg.com/political-capital/2013-12-16/norquist-end-of-the-grand-bargain/
http://go.bloomberg.com/political-capital/2013-12-16/norquist-end-of-the-grand-bargain/#commentsMon, 16 Dec 2013 15:13:40 +0000http://blogs.edit.bloomberg.com/political-capital/?p=113859Democrats, chafing at the “choke collar” on their appropriators, are yielding their desire to raise taxes to their thirst for bigger spending, says one of the capital’s leading anti-tax activists. The budget deal at hand — approved overwhelmingly by the House last week and ready for apparent Senate approval this week is proof, says Grover […]

“The reason why this deal is interesting and important is that it signals the end of the grand bargain,” Norquist said at a Bloomberg Government-sponsored breakfast at Bloomberg’s Washington bureau today. “The sequester changed that,” he said of the automatic spending cuts that are somewhat eased in the bipartisan agreement soon ready for the president’s expected signature.

“The Democrats saw the sequester as a choke collar,” he said, while the Tea Party and Republican Party leadership are in “complete synch: ‘Let’s live with the sequester.”’

In the bargain, he said, the Democrats have won their goal of protecting entitlements, and the Republicans have won their prohibition against new taxes, says Norquist (while conceding that the fee created for the Transportation Security Administration “looks like an excise tax.”)

The agreement eases about $63 billion of those automatic spending cuts over two years, while maintaining most of the sequestration over 10 years. “We protected the sequester,” Norquist says.

“We loosened the collar… what I think is a loose-fitting collar.” And from now on, he suggests, the debate will center on further loosening of the collar rather than the major tax increases that Democrats have insisted must be part of any “grand bargain” for cutting the deficit. “The pressure point on the modern Democratic Party is not their appetite for taxes.” Rather, he says, it is their discomfort with any squeeze on spending — robbing congressional appropriators of a beloved power.

“That’s why I’m not bouncing off the walls,” he says of the deal that passed by the House by 332-94 yet is likely to clear the Senate by a far closer margin. “I think it’s going to pass.”

In the process, he says, even the Defense Department is learning to live within tighter means. “We’re out there fondling the third rail of politics and there are no sparks.”

]]>http://go.bloomberg.com/political-capital/2013-12-16/norquist-end-of-the-grand-bargain/feed/0Coalition of Industries and Advocates Fight Sequestrationhttp://go.bloomberg.com/political-capital/2013-12-02/broad-coalition-of-industries-and-advocates-fight-sequestration/
http://go.bloomberg.com/political-capital/2013-12-02/broad-coalition-of-industries-and-advocates-fight-sequestration/#commentsMon, 02 Dec 2013 20:44:30 +0000http://blogs.edit.bloomberg.com/political-capital/?p=112132The defense aerospace industry gave 60 percent of its donations to Republicans during the 2012 elections. The high-tech industry gave 59 percent of its contributions to the Democrats. Now, representatives of both industries are teaming up to push back on a common threat: U.S. budget cuts. Officials of the Aerospace Industries Association and Semiconductor Industry Association […]

An attendee visits the Northrop Grumman Corp. booth during the 28th National Space Symposium in Colorado Springs.

The defense aerospace industry gave 60 percent of its donations to Republicans during the 2012 elections. The high-tech industry gave 59 percent of its contributions to the Democrats. Now, representatives of both industries are teaming up to push back on a common threat: U.S. budget cuts.

Officials of the Aerospace Industries Association and Semiconductor Industry Association were among those speaking out today against the across-the-board spending cuts known as sequestration.

“All of us feel the same alarm,” said Hunter Rawlings, president of the Association of American Universities. “That’s how bad the sequester is.”

Speakers said sequestration cuts are jeopardizing the nation’s technological edge in weapons systems and threatening the research and development that leads to new industries and new jobs. Rawlings pulled out an Apple Inc. iPhone and said all of its technology originated from government-funded research.

“We can talk all we want to about cutting spending,” said Wes Bush, chief executive officer of Northrop Grumman Corp. and chairman of the Aerospace Industries Association. “We know over the long term, reducing the deficit involves growing our economy. Growth requires investment.”

Cuts to research programs mean that students who might go into those fields will find another line of work, depriving U.S. industries, including military contractors, of their talent, according to Ian Steff, a vice president of the Semiconductor Industry Association. “If the money’s not there, the students won’t be there either,” Steff said.

Speakers acknowledged the need for some spending reductions, such as cutting “inefficient and duplicative programs and streamlining processes,” said Dorothy Coleman, vice president of tax and domestic economic policy for the National Association of Manufacturers.

“We all know the realities facing our nation’s debt and deficit, but the logic behind cutting funding for the very things that will spark robust economic growth is shortsighted and harmful,” Coleman said. “Congress needs to make the tough decisions on spending to address our debt crisis, but these decisions cannot be made at the expense of our economic and national security.”

Entitlement programs and revenue increases must also be on the table, speakers said.

Even calls for flexibility in making cuts won’t stave off the harmful impacts as the amount of money available gets smaller and smaller under sequestration, according to Emily Holubowich, co-chairwoman of NDD United, a coalition of trade groups, advocacy organizations and labor unions.

“There’s no amount of flexibility that will make this workable,” she said.

Today’s event was the latest in a series involving AIA, which has launched one of its largest lobbying efforts ever to convince Congress to do away with sequestration. The trade group also brought smaller subcontractors to Capitol Hill to meet with lawmakers and their staffs.

]]>http://go.bloomberg.com/political-capital/2013-12-02/broad-coalition-of-industries-and-advocates-fight-sequestration/feed/0Fine for Overpriced Apples: $4.2 Mlnhttp://go.bloomberg.com/political-capital/2013-11-19/the-cost-of-charging-too-much-for-apples-and-peaches-4-2-million/
http://go.bloomberg.com/political-capital/2013-11-19/the-cost-of-charging-too-much-for-apples-and-peaches-4-2-million/#commentsTue, 19 Nov 2013 17:15:28 +0000http://blogs.edit.bloomberg.com/political-capital/?p=110854The $600 toilet seat may have to move over for the $50 apple. FreshPoint Inc., a Houston-based subsidiary of Sysco Corp., has agreed to pay $4.2 million to settle allegations that it overcharged the Defense Department for the purchase of fresh fruits and vegetables. According to the Justice Department, the company was supposed to provide […]

FreshPoint Inc., a Houston-based subsidiary of Sysco Corp., has agreed to pay $4.2 million to settle allegations that it overcharged the Defense Department for the purchase of fresh fruits and vegetables.

Instead, FreshPoint adjusted the cost to whatever it determined the prevailing market price to be at the time. Hundreds of sales were made from 2007 to 2009.

“The Department of Justice is committed to ensuring the integrity of federal contracts and will pursue contractors that knowingly overcharge the government for goods or services,” Assistant Attorney General Stuart F. Delery said in a statement. “Contractors that do business with the government must do so honestly and fairly or suffer the consequences of their misconduct.”

A former FreshPoint employee, Charles Hall, filed a lawsuit under the False Claims Act as a whistleblower, and received $798,000.

FreshPoint did not immediately respond to an e-mail and phone call seeking comment.

]]>http://go.bloomberg.com/political-capital/2013-11-19/the-cost-of-charging-too-much-for-apples-and-peaches-4-2-million/feed/0Companies Decrying Shutdown Backed Republicans Who Pushed Ithttp://go.bloomberg.com/political-capital/2013-10-17/companies-decrying-shutdown-backed-republicans-who-insisted-on-it/
http://go.bloomberg.com/political-capital/2013-10-17/companies-decrying-shutdown-backed-republicans-who-insisted-on-it/#commentsThu, 17 Oct 2013 19:18:05 +0000http://blogs.edit.bloomberg.com/political-capital/?p=106314The political action committees of Lockheed Martin Corp. and Raytheon Co. contributed to the campaigns of Tea Party-aligned House Republicans just before the partial government shutdown that ended this week. Lockheed, the largest U.S. contractor, was among the companies forced to furlough workers, while others had orders delayed or projects shut down as federal employees […]

The political action committees of Lockheed Martin Corp. and Raytheon Co. contributed to the campaigns of Tea Party-aligned House Republicans just before the partial government shutdown that ended this week.

Lockheed, the largest U.S. contractor, was among the companies forced to furlough workers, while others had orders delayed or projects shut down as federal employees supervising the work stayed home. Federal agencies award more than $500 billion a year in contracts.

At least eight PACs contributed $15,500 during the last week of September to seven Republicans who helped lead efforts to defeat any spending bill that also did not defund or delay the president’s health-care law. That insistence on a tie to Obamacare resulted in a partial government shutdown starting Oct. 1.

The companies could have thought the donations “would play a constructive role” in getting “a seat at the table to voice their concerns,” said Sheila Krumholz, executive director of the Center for Responsive Politics, a Washington-based research group that tracks campaign donations. “PACs and individuals give contributions for the purpose of rewarding behavior they approve of or enticing members to act consistent with their agenda.”

The House on Sept. 20 passed legislation to keep the government open in the new fiscal year beginning 11 days later, as long as the Patient Protection and Affordable Care Act of 2010 was defunded. On Sept. 26, 21 House Republicans insisted that Senate Republican leader Mitch McConnell of Kentucky block efforts to debate and amend the bill, lest the Democratic majority remove the anti-health care law provision. McConnell rebuffed that request and Senate Democrats did strip out the provisions defunding the law, which is designed to provide coverage to millions of uninsured Americans.

Seven of those 21 Republicans received PAC donations from federal contractors during that final week, Federal Election Commission filings show.

“These companies were undercutting their own bottom lines,” said Craig Holman, who lobbies on campaign finance issues for Public Citizen, a Washington-based advocacy group. “They should not have been playing the regular game of sending money to everybody.”

Lockheed’s spokesman, Gordon Johndroe, said the company “contributes to a wide variety of candidates from both political parties.” He declined to comment on any specific donations. A spokeswoman for Waltham, Massachusetts-based Raytheon, Pam Erickson, didn’t respond to phone calls and e-mails seeking comment.

Business leaders have been critical of Congress over the shutdown and the across-the-board spending cuts known as sequestration, which remain in effect under the spending resolution that reopened the government.

“The 2014 midterm elections will certainly be pivotal for our industry,” said Chip Sheller, a vice president of the Aerospace Industries Association, the Arlington, Virginia-based trade group whose members include Lockheed Martin and Raytheon. “National security is a house of cards, and our elected officials are on the verge of knocking down the whole lot by neglecting those companies who arm the warfighter with a technological edge over our enemies.”

Also on Sept. 30, the PAC of Chicago-based Boeing, the No. 2 contractor, donated $1,000 to Rep. David Schweikert of Arizona, another lawmaker who signed the letter.

“Boeing complies with all federal laws and regulations governing corporate contributions to elected officials, and a full accounting of our contributions are a matter of public record,” said Tim Neale, a spokesman.

Company executives visited or called lawmakers during the shutdown, urging them to reopen the government.

“Everybody is talking to Congress,” Stu Shea, president and chief operating officer of Leidos Holdings Inc., a Reston, Virginia-based science and technology solutions company, said. “We’re putting our entire way of life at risk.”

Holman said the PAC donations could have undercut the companies’ arguments.

“It’s not as if the Tea Party representatives saw any loss in campaign contributions coming from government contractors,” Holman said., “I was wondering why the CEOs seemed to have so little influence over the Tea Party Republicans. This could explain part of it.”